Policy for Minor Children: The LIC Jeevan Utsav policy is a non-linked, non-participating, individual, savings, whole-life insurance plan. The policyholder can avail of tax benefits on the premium paid towards the LIC Jeevan Utsav policy under Section 80C of the Income Tax Act, 1961. Additionally, the benefits received are tax-free under Section 10 (10D) of the Income Tax Act.

In the Regular Income variant of the LIC Jeevan Utsav policy, the policyholder gets income equal to 10% of the Basic Sum Assured every year until the policyholder passes away.

As for the taxability, it’s important to note that if the Sum Assured on Death does not exceed (or equal) 10X Annualized premium, the maturity/survival benefit will not be exempt from tax. However, the death benefit will still be exempt from tax. Also if Sum Assured exceeds 10X of Annualized premium then maturity and survival benefits will not be taxable.

As for the best LIC policy for your 3-year-old child, there are several options you might consider:

LIC Jeevan Utsav: One of the Best Plans for children is to gift them lifetime guaranteed income.

Proposer Details

First Year Premium

2nd Year onwards Premium

Once the child’s age becomes 19 he will start getting a guaranteed income of Rs 200000 Yearly for a lifetime.

LIC Jeevan Tarun Plan: This is a participating non-linked limited premium payment plan. It offers an attractive combination of protection and saving features for children.

Proposer Details

First Year Premium

2nd Year onwards Premium

Returns after 22 Years

LIC Child Money Back 932: This is another option you might consider.

Proposer Details

First Year Premium

2nd Year onwards Premium

Returns after 22 Years